Tom Lee: Fed's rate cut to push Bitcoin to $20,000 by year-end
- Tom Lee repeats his optimistic Bitcoin forecasts.
- Accommodative monetary policy will drive investments into Bitcoin.
Tom Lee, a co-founder of Fundstrat Global Advisors, sticks to his optimistic Bitcoin forecasts. He is convinced that the accommodative monetary policy of the US Federal Reserve (Fed) will help the first cryptocurrency to reach the $20,000 by the end of 2019. He repeated his forecast in the recent interview with FOX Business.
Thus, Lee believes Fed" decision to cut the fed fund rate will contribute to Bitcoin's bullish trend.
He explained that Bitcoin had become a tool to hedge against macroeconomic and political risks. When rates go lower, the liquidity is growing, while investors tend to funnel the money into risky assets and hedging instruments. This tendency will have a positive effect on Bitcoin, Fundstrat's co-founder added.
On July 31 the Fed cut the interest rate by 25 points for the first time in the ten years, from 2.25–2.5% to 2–2.25%.
It is worth noting that during a hearing at the Senate Banking Committee of the United States, Fed Chairman Jerome Powell agreed that the global cryptocurrency could reduce the need for reserve currencies, but noted that so far "almost no one uses bitcoin as a means of payment" and called it "speculative store of value. "
In June, Tom Lee announced that Bitcoin would reach $40,000 within months once $10,000 barrier is taken out.
Author
Tanya Abrosimova
Independent Analyst
